If you want to succeed as a trader, the very first step, is running your trading like a business. Many traders start out with the wrong mindset as they treat trading like a gambling hobby rather than a business. Trading requires structure and planning and which has real costs associated with it.
As discussed on our TTC Eduction page there are different trading sessions. Depending on your trading strategy will determine what times during the day you will trade. Just as a business has a set opening and closing times so should we as traders. Find your most profitable time to trade and stick with it.
It is important to note traders tend to be independent meaning they have no boss. This means it is vital we schedule in some time away from the market. For example we tend to avoid the markets around the Christmas period as the market is not very liquid and we can spend quality time with friends and family. Everybody could do with a holiday at time.
The most successful traders make the most profit when the market is closed. How is this possible?
Well even though the market is closed they take the time out to review price action activities that have taken place in the previous week. This will ensure they can capitalise on trade setups for the following week. Traders who analyse markets when they are closed are way ahead of the pack when the market opens as they are already prepared.
Do not be fooled by the complex multi screen computers you see online by so called millionaire traders. At the Trend Traders Circle we like to keep everything simple which ensures low business cost, as all we need is a Laptop, Pad and a pen.
Traders will also need to choose a platform to trade from. Brokers will tend to offer a trading platform but it is your responsibility to make sure it meets your criteria.
As Trend Traders we want to be able to capitalise from all markets including Forex, Stocks and Commodities. We need to ensure our broker is able to allow us scope to capitalise from these markets.
All new businesses MUST consider their start up cost before launching their operation. For traders there is no difference as we have some expenses we need to take into consideration also.
First thing we need to understand is how much money will we spend on equipment, as we have previously mentioned all we really need is a Laptop, Pad and a Pen and most people already have these.
Secondly we must be fully equipped with the correct knowledge and skill to profit within the market. If we want to be successful in trading we are likely to invest in a number of books or even participate in a training course. These are further cost for new and existing traders to consider.
Finally, we must include how much money we are willing to invest in our trading account, this will be different with every trader as some may be willing to invest more than others.
Most businesses will keep a record of the activities that have taken place within the operation so they can track their progress. Traders will complete something similar in a form of a journal. A journal will be a traders best friend and will include commentary of all trading activity that has taken place. It is important for traders to take the timeout to review the contents of the journal and learn from mistakes and best practices.
Remember business are not successful overnight, it takes some businesses years to make a profit and traders are no different. Stay strong and always continue to learn and develop your craft.
Happy Trading Guys :-)